LONDON - Oil declined in New York as euro-area unemployment reached the highest level on record, prompting speculation that crude’s surge last week, its biggest in three years, may have been excessive.

The jobless rate in the 17-nation area rose to 11.1 percent in May from 11 percent in April, the European Union’s statistics office in Luxembourg said today. That’s the highest since the data series started in 1995.

China’s manufacturing activity slowed in June, according to HSBC Holdings Plc and Markit Economics. An EU embargo on Iranian oil started yesterday.

“Crude’s strong movement last week was a bit too much too fast probably, so today we’re seeing it a bit lower again,” said Hannes Loacker, an analyst at Raiffeisen Bank International AG in Vienna, who correctly predicted Brent crude would rebound at the end of last month. “Headwinds from the euro zone” may delay oil’s recovery, he said.

Crude for August delivery dropped as much as $1.80 to $83.16 a barrel in electronic trading on the New York Mercantile Exchange and was at $83.44 at 11:41 a.m. London time. Prices gained $7.27 on June 29 to $84.96, the highest close since June 6. Crude declined 18 percent last quarter, the most since the final three months of 2008, and slipped 1.8 percent last month.

Brent oil for August settlement on the London-based ICE Futures Europe exchange fell as much as $2.50, or 2.6 percent, to $95.30 a barrel. The European benchmark crude was at a $12.25 premium to New York contracts compared with $12.84 on June 29.

Bullish bets

Prices surged June 29 because of optimism the European debt crisis may be contained after leaders agreed to ease repayment rules for emergency loans to Spanish banks and relax conditions on help for Italy. Hedge funds raised bullish oil bets for the first time in eight weeks before the price rise, according to a weekly report from the U.S. Commodity Futures Trading Commission.

Crude’s jump brought prices in New York close to technical resistance, prompting investors to sell futures. The August contract has resistance at $85.33 a barrel, the 23.6 percent Fibonacci retracement of the drop to last week’s intraday low of $77.28 from the March 1 high of $111.38, according to data compiled by Bloomberg. Sell orders tend to be clustered near chart-resistance levels.

The EU banned the purchase, transportation, financing and insurance of Iranian oil because of the Persian Gulf nation’s nuclear program. The insurance embargo affects 95 percent of the world’s tankers because they’re covered by the 13 members of the London-based International Group of P&I Clubs.

Iran sanctions

Iran was producing about 3.2 million barrels a day in May, according to estimates compiled by Bloomberg. Full implementation of sanctions will remove about 1 million barrels a day during the second half of the year as buyers disappear and Iranian storage tanks become full, the Paris-based International Energy Agency said in a June 13 report.

“The Iranian import ban is well known, but now that it’s officially coming into effect this also helps sentiment for oil prices,” said Raiffeisen Bank International’s Loacker. “If Brent moves above $100, its gains can go very fast from here, but if some headwinds from the euro zone pop up it will take longer.”

A reduction in Iranian exports may become the biggest supply disruption from a member of the Organization of Petroleum Exporting Countries since an armed rebellion all but halted pumping in Libya last year, according to the IEA. A strike by oil workers in Norway also curbed flows from North Sea fields.

Iranian Minister

Iran called on OPEC to hold an emergency meeting to address the group’s production in excess of the targeted 30 million barrels a day, Mehr news agency reported June 30, citing the country’s oil minister.

Disregard of the target by some OPEC members “will negatively impact prices in the international market,” Rostam Qasemi said, according to the state-run agency’s report. “The organization’s members must respect the production ceiling to maintain the supply and demand in oil markets,” he said.

The HSBC Manufacturing Purchasing Managers’ Index for China fell to 48.2 last month from 48.4 in May. The final figure is higher than the 48.1 flash reading released June 21.

Official figures peg China’s PMI at 50.2 in June, down from 50.4 in May, the Beijing-based National Bureau of Statistics and China Federation of Logistics and Purchasing reported yesterday.

Get the most up-to-date data on the Rhode Island and southern Massachusetts business community from the PBN List Center. Download and purchase PBN Lists as well as the complete Book of Lists in Excel format.